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Polaris plans to establish manufacturing facility in Mexico

May 21, 2010

In an effort to improve its long-term competitive positioning, increase operational efficiencies and position the company for future growth, Polaris Industries intends to realign its operations, according to a company press release.

Among the changes, Polaris says it plans to enhance the existing Roseau, Minn., and Spirit Lake, Iowa, production facilities and establish a new facility in Mexico. The exact location in Mexico has not yet been determined. The new facility will lead to the eventual sale or closure of Polaris’ Osceola, Wis., manufacturing operations.

The realignment allows the company to dedicate capital for strategic investments in painting, welding and assembly operations by outsourcing certain non-strategic component manufacturing processes, stated Polaris in the release.

“While this was a difficult decision for us, given the impact on our employees at the Osceola facility, we believe the creation of these manufacturing centers of excellence will strengthen our company over the long-term and enable us to maintain our lead in a competitive market,” Scott Wine, CEO, Polaris Industries, said in the release. “Pursuing opportunities in new markets outside the United States, while concurrently evaluating our cost structure to improve our long-term competitive positioning are key components to our growth strategy. This decision was based on a thorough review of our worldwide operations and will allow us to improve our ability to meet the quality, delivery and cost standards desired by our dealers and customers.”

The realignment is expected to generate pre-tax costs and expense savings in excess of $30 million on an annual basis when the transition has been completed. The company expects to begin realizing some of the cost savings as early as 2011.

For more information, see an upcoming issue of Powersports Business.

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